@Opus 17 wrote:
@thesimroths wrote:
I did the same thing - sold the car about three weeks after buying from the leasing company. However, before I could resell the car, I had to put the title and registration in my name. Can I include those costs ($106.50) in the cost-basis for the car? Thank you.
No.
However, I wonder if part of your lease payments should be included in the cost basis.
@Hal_Al , @Carl , @rjs any ideas?
My friends haven't weighed it, but I am still of the opinion that part of your lease should be considered money that you paid for the car and included in the basis. Specifically, the capitalized cost (not the interest, or acquisition fees, or excess mileage fees, or other fees, etc.)
https://cars.usnews.com/cars-trucks/how-does-leasing-a-car-work
https://cars.usnews.com/cars-trucks/car-leasing-costs-taxes-fees
Quoting:
Let's look at an example using a 2019 Honda CR-V to illustrate. For simplicity, we’ll say that you negotiated a $30,000 price for the purchase or lease, and you’re going to make a $3,000 down payment with either transaction. If you get financing for five years with a 5 percent interest rate on a loan from a bank, credit union, or other financial institution, the monthly payment is $510 for the purchase of the Honda. You can use our car loan calculator to figure this out.
Let's say you choose to lease instead. For this example, we'll assume that your CR-V will be valued at $17,000 after three years and you're getting an interest rate (called the "money factor" in leasing) that's equivalent to 5 percent. The difference between the negotiated price and the residual value is $13,000. You'll pay $3,000 up front, and the remainder of $10,000 will get split up into equal monthly payments. Generally, your first month's payment is included in the amount you pay up front, so the remaining $10,000 gets divided over 35 equal monthly payments. Your lease payments will be about $308 per month, plus some fees.
That sure sounds to me like your capitalized cost should be part of your basis.
